NOTICE OF DISCIPLINARY ACTION

A. No person shall enter or cause to be entered an order with the intent, at the time of order entry, to cancel the order before execution or to modify the order to avoid execution.

FINDINGS:

On May 23, 2019, a Panel of the Chicago Board of Trade (“CBOT”) Probable Cause Committee (“PCC”) charged non-member Kunal Makhijani (“Makhijani”) with violating CBOT Rule 575.A. based on allegations that on one or more occasions between April 2017 and February 2018, Makhijani engaged in disruptive trading activity in various Soybean Oil futures markets by entering orders without the intent to trade. Specifically, Makhijani typically entered a larger order, or layered orders, on one side of the market and then cancelled them after resting smaller orders on the opposite side of the book were executed. Additionally, Between April 2017 and June 2017, Makhijani also displayed a pattern of entering orders for various Soybean Oil futures contracts on the Globex electronic trading platform during the pre-opening period that were not entered in good faith for the purpose of executing bona fide transactions.

On July 16, 2019, a Hearing Panel Chair of the CBOT Business Conduct Committee (“BCC”) entered an order finding that Makhijani failed to answer the charges issued against him. In failing to answer the charges, the Hearing Panel Chair further ordered that Makhijani was deemed to have admitted the charges issued and waived his right to a hearing on the merits of the charges.

Pursuant to CBOT Rule 407.C., a penalty hearing was held before a Panel of the BCC (“Panel”) on August 13, 2019. The Panel found Makhijani guilty of committing the admitted charges.

PENALTY:

Based on the record and the Panel’s findings and conclusions, the Panel ordered Makhijnai to pay a fine in the amount of $45,000, and suspended Makhijani from access to any trading floor owned or controlled by CME Group and from direct and indirect access to any designated contract market, derivatives clearing organization or swap execution facility owned or controlled by CME Group for five years, beginning on the effective date below and continuing for five years from the date that the ordered fine is paid.

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Who We Are

CME Group is the world's leading and most diverse derivatives marketplace. The company is comprised of four Designated Contract Markets (DCMs). Further information on each exchange's rules and product listings can be found by clicking on the links to CME, CBOT, NYMEX and COMEX.